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SunRice FY22 revenue a record high at $1.3 billion

Grain Central, June 23, 2022

SunRice’s results have included some record highs. Photo: Deniliquin Freighters

AUSTRALIA’S single-desk rice marketer SunRice Group has posted record revenue of $1.3 billion for its financial year ended April 30, up 30 per cent on FY21, it said in FY22 results released today.

Group EBITDA of $91.3 million and NPAT of $48.7 million were up 86pc and 167pc respectively on FY21.

The naturally determined CY21 pool paddy price of $428 per tonne for medium-grain Reiziq rice was also a record.

The CY22 crop has now been harvested, and at around 675,000 paddy tonnes, is the largest in five years, and well up on the CY21 crop of 450,000t.

Ahead of planting of the next Australian Riverina crop later this year, seasonal conditions, water availability and water pricing remain highly favourable, with water-storage levels their highest at this point in the season in more than 20 years.

Challenges felt

SunRice CEO Rob Gordon said the result came after two years of near record-low Australian rice production during which the company diverted resources to maintain supply of key markets with rice from other origins, and invested in acquisitions and progressing other organic growth initiatives.

“This improved FY2022 result was the consequence of the return of Australian rice to key markets, the accretive contribution of recent acquisitions, and the group’s multi-origin, multi-price point international rice-supply capability,” Mr Gordon said.

“It was also the result of the incredible dynamism and efforts of our people, who continued to demonstrate extraordinary resilience two years into the COVID-19 pandemic.”

SunRice’s international sourcing program allowed demand of more than 1.1 million paddy tonnes to continue to be met at different price points through a multi-origin supply capability that covered 11 countries in FY22, and improved profitability was seen in key Pacific markets.

Results were delivered despite challenging trading conditions and continued headwinds, including unprecedented escalation in freight rates, and systemic supply chain disruption.

SunRice’s CopRice feed division also faced headwinds, including strong pasture conditions which reduced demand from key markets.

Mr Gordon said SunRice was well positioned for FY23 and beyond.

“This is particularly the case given the resurgence in Australian supply, our capabilities in international rice sourcing and emerging drought conditions in key rice-production areas around the globe.

“However, there are substantial challenges – most notably the ongoing disruption to global shipping and escalation in freight costs, and worsening inflationary pressures on key business inputs.

“We remain focused on utilising our strong balance sheet to explore further value-accretive acquisitions which align with our Growth Strategy and continuing to invest in consumer and market-focused organic growth initiatives.”

The continued resurgence of Australian rice coupled with SunRice’s multi-origin, multi-market rice capability, has it well placed to benefit this year from an environment where key markets are under-supplied.

This is due to factors including broader disruption from the Ukraine conflict and a number of rice-growing regions either in or entering drought around the world.

Brands make headway

A full-year contribution of the KJ&Co Brands business, acquired in FY21 by the Riviana Foods segment, was positive for FY22 results.

It drove an uplift in revenue and profitability for Riviana Foods which, when combined with other existing brands, now provides SunRice with consistent earnings decoupled from the Australian agricultural cycle.

Market share gains in microwave products, supported by organic initiatives such as the re-launch of the Our Best Yet microwave rice pouch range, underpinned by investment in manufacturing capability and in-house innovation.

Source: SunRice

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